The anticipated rally in the price of Fetch.ai (FET) may not come to fruition, despite the fact that it has broken through key resistance at $2.50. Let’s find out the reason.
The continued growth of Fetch.ai (FET) is something that investors are hoping for, but they might be let down. The widely used AI token has already reached its market peak and is now vulnerable to selling pressure.
Perhaps Fetch.ai will fall behind
A possible rally could be in the works if prices break out of consolidation and then surpass a critical resistance level. But things aren’t simple because this week Fetch.ai (FET) formed a market top.
An asset’s price reaches its peak just before it begins a precipitous fall; this is called a market top. If this is the case, then bullish sentiment has peaked. Once investors start selling off their holdings and the market cools, corrections are often seen alongside this.
When the on-chain measure of the profit share of coins reaches 95%, the market forms a top. In the case of FET, this is precisely what occurred; at present, 95.3% of the token supply is profitable. A sale is involved in this.
Another sign that something similar is happening is when the price and daily active addresses transacting on its network (DAA) diverge. When a cryptocurrency’s price and its DAA go in opposite directions, it’s called divergence. Market valuation and network usage may not be in sync, according to this.
Usually, it’s a good sign to sell when prices go up and network participation goes down. This criterion is satisfied for FET, which may cause sales to take a profit.
FET prediction: negative trends are probable
In just three days, the price of Fetch.ai surged nearly 18%, passing the $2.50 resistance level and reaching $2.58. The altcoin was able to break out of a consolidation that had been going on for a month because of this, but FET might be heading back into it soon.
All of the aforementioned reasons point to a price decline, so this is the result. As a result, Fetch.ai may drop below $2.26 if it loses support at $2.50. However, the market could cool and lead to sideways movement if prices bounce from the $2.50 support. Such dynamics can counteract the negative prediction by supporting the price as long as demand is high.

Rise to the top of the market for Fetch.ai (FET), new record unlikely

Blocksays

Other articles published on May 22, 2024

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